OFFICIAL PUBLICATION OF THE Illinois Automobile Dealers Association

Pub. 11 2021 Issue 3


IADA Chairman’s Message

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Illinois Auto Dealer News Magazine Pub 11 2021 Issue 3

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On behalf of the IADA Board of Directors and staff, I would like to dedicate this edition of our Illinois Automobile Dealers Association News to the Association members sharing the success of our most recent legislative spring session. IADA enjoyed an extremely successful year at the State Capitol thanks to the joint effort of our members’ grassroots participation and the support of our state legislators.

We encourage you to reach out to your legislators, reintroduce yourselves, and thank them for their support and advocacy of the many IADA-promoted bills that passed out of the General Assembly this 2021 Legislative Session.

Some of the dealer issues the legislature addressed include the following:

SB 58 – Restores Sales Tax Credit on Trade-In Vehicles

This legislation restores the total sales tax trade-in credit on vehicle trade-ins. Two years ago, lawmakers capped the sales tax trade-in credit at $10,000 to fund capital infrastructure projects necessary statewide.

This bill will be sent to the Governor this month for his signature to ensure the bill becomes law. We will be reaching out to you, our membership, to urge him to sign. And if signed into law, this legislation becomes effective Jan. 1, 2022.

HB 3940 – Dealer Compensation for Warranty Work

HB 3940 amends the Illinois Motor Vehicle Franchise Act to require vehicle manufacturers to compensate franchised dealers fairly and adequately for vehicle warranty work. Also, this bill adjusts manufacturer calculations for time allowances, labor rates, and parts prices for warranty work.

HB 3940 passed the Illinois legislature and now goes to the Governor for his consideration. If signed into law, it becomes effective Jan. 1, 2022. We express our heartfelt appreciation to CATA who joined together with us to advocate for dealers and mechanics in passing this legislation.

Elimination and Capping Retailers Discount (Several Proposals / Legislation) — Defeated

IADA was able to block the many proposals capping or eliminating the retailers’ discounts. The Governor’s administration was looking for ways to raise revenue for the state, and one of their proposals was to eliminate or cap the retailers’ discount.

Currently, dealers and Illinois retailers receive a discount of 1.75% of the sales tax they collect as partial reimbursement for the cost of calculating, collecting, and remitting sales tax on behalf of the state. IADA is happy to report that all of these proposals have stalled for this year.

We expect these bills to be re-introduced annually as the state continues to look for increased revenues.

SB 573 – 90 Day Drive Away Permit / $20 Dealer Title

IADA was able to make a couple of changes to the Illinois Vehicle Code. The first change was to extend the current 30-day drive-away permit to 90 days, thereby assisting dealers and consumers with enough time for titling and registering vehicles.

SB 573 also allows dealers to pay $20 for a dealer title when the assignment areas are full, saving dealers from paying the total price on titles.

If signed into law, this legislation becomes effective Jan. 1, 2022.

HB 2435 – Amends the Motor Vehicle Franchise Act

HB 2435 defines the term “secondary product” as all products that are not new motor vehicles or OEM parts. It also states that a manufacturer cannot prohibit or require a dealer to offer a secondary product, including but not limited to service contracts; maintenance agreements; extended warranties; protection product guarantees; gap waivers; insurance; replacement parts; vehicle accessories; oil; or supplies.

HB 2435 also permits a manufacturer to offer an incentive program to encourage dealers to suggest manufacturer-approved or endorsed secondary products. And this bill prevents manufacturers from dictating those dealers use only manufacture branded products and extended service contracts. If signed into law, it will be effective Jan. 1, 2022.

Issues That IADA Opposed and Were Defeated:

  • Capping the doc fee at $150.00, a 50% reduction from the current doc fee
  • Creates the Paid Family Leave Act
  • Increasing minimum wage to $20 an hour
  • Blocking consumer privacy bills; adds extra layers of work/disclosures for dealerships
  • Creates the Fair Workweek Act — provides for guaranteed work schedules/rest periods
  • Creates the Healthy Workplace Act — provides a specified number of paid sick days for employees

IADA would like to express its gratitude for IADA members’ calls and notes to their respective legislators to pass these vital legislation pieces to the Governor. In the near future, we will be asking dealers for their continued assistance in contacting the Governor for his approval on legislation and his subsequent signatures that make bills into law. As you can see, your continued support of IADA is so essential! We appreciate your involvement, and the IADA Board of Directors and staff continue to work hard on your behalf.

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